Disney is currently exploring whether to license its content in digital form to major digital media platforms like Netflix, Hulu, Amazon and Apple.
The news comes amid ongoing debates about whether Disney should allow its movies to be streamed on streaming services like Netflix and Amazon, which are increasingly using digital distribution models.
While some content companies, like Amazon, have made a move to license their content in physical format, Disney and Lucasfilm, which owns the Star Wars franchise, have largely remained in the dark.
In November, Disney released a draft version of its Digital Licensing Agreement, a document that outlines how Disney will license its movies and TV shows for digital distribution.
Disney said the draft agreement was released on Wednesday, but did not release details.
In a blog post announcing the document, Disney wrote that the draft document is “a step toward establishing a shared, trusted digital entertainment ecosystem that can better deliver content to consumers and allow Disney to grow in new ways and deliver new value to our shareholders.”
“Disney believes that Disney’s core brands and brand properties should be at the heart of any digital ecosystem, and we look forward to working with our partners to ensure that Disney is able to continue to deliver on this commitment,” the post reads.
Disney’s move to begin licensing in digital format has drawn criticism from a number of digital distribution companies, including Netflix, whose CEO Reed Hastings said earlier this year that the company should license its digital content in a physical format.
“Disney should be able to license in a format that’s more secure and efficient than streaming to Netflix and other online platforms, including in-person viewing and video on demand,” Hastings said at the time.
Disney is also exploring whether it should license digital content from third parties.
Netflix, for example, has a digital distribution agreement with Warner Bros., which also owns the Harry Potter franchise.
The deal calls for Netflix to pay Warner Bros. $4 billion for exclusive rights to the Harry, GoT and Star Wars universes, which Warner Bros.’s streaming services would be able use to distribute its films.
“The Harry Potter films are available on Netflix, so we would be happy to pay the $4 million,” Netflix’s CFO Brett Cohen said in a blog posting last week.
Netflix has a separate agreement with Marvel Studios that calls for Marvel Studios to pay Netflix $4.8 billion to acquire and distribute the films, but Warner Bros and Marvel have not yet agreed on the terms.
Disney has been exploring a licensing arrangement with Disney that would require it to pay Disney $4,500 per movie.
Disney’s deal with Disney could mean that Disney could receive $4 per movie if Disney pays a higher amount to Warner Bros./Marvel than to Netflix.
The licensing agreement also says Disney will pay Disney’s upfront costs for licensing the movies, but that Disney will also receive the $2.5 billion to $4-per-movie royalty for the movies in perpetuity.
Disney has been testing different licensing models, and has been in talks with Netflix, which has been looking to use digital distribution to distribute the company’s films, Cohen said.
Disney says it will not charge Disney’s license fee for licensing in-home viewing, although the deal would still require Disney to pay for in-house viewing, Cohen added.
Disney and LucasFilm will also be working with third parties to offer digital streaming of Disney films.
Disney said in an investor presentation that it has been negotiating with Netflix and Hulu about its plans for streaming content.
Disney will likely begin releasing the new Digital Licenses Agreement, including its draft, in mid-November, the company said.
The document, which is expected to be approved by the board of directors, will be available for public comment and discussion.
Disney does not have a digital content plan, but the company is planning to introduce a new digital licensing agreement later this year, according to the blog post.